Have you ever wondered if the government can write off your debt? Well, it is true. The government is an equal opportunity lender.
Banks, home owners, and mortgage companies have been run into the ground over the last few years due to the U.S. economy. We are only in the early stages of a debt crisis.
You may think that the government can’t afford a bailout for these institutions, but the government made the decision to give them a hand up with the new government stimulus package. So, let’s take a look at what the government can do to help you with your debts.
Bad debt is defined as unsecured debt. This means that the loan was unsecured. For example, credit cards, student loans, personal loans, store credit cards, etc. If you are unable to pay the debt back, you are facing bankruptcy.
Good debt is one that has a collateral or security. Say you took out a car loan. Now you might owe on that car, but if you could sell it for pennies on the dollar, then you would owe no more on that car.
If the car is your asset and the balance is not too high, the government may forgive you of that debt. That can be something as simple as a new car, a second mortgage on a new house, or a boat. All these things can be written off, and the government will see that they aren’t spending other people’s money.
Personal loans can also be forgiven if you are unable to pay back the debt. A personal loan that isfor an emergency expense or a payment you are in way over your head on. But even if the loan is used for things like medical expenses and bills that were late, the loan can be forgiven.
Business debt can also be forgiven by the government, and the same goes for business credit cards. Sometimes this is done for educational purposes, and sometimes it is to help prevent a business from going bankrupt.
Now, we all know that businesses use business credit cards and the same thing goes for personal and business debt. You can use your business credit card and it can be forgiven.
Home owners, mortgages, and government debt can also be forgiven by the government. You are not allowed to own property or an asset that is related to another person’s mortgage.
This does not include a home that you own, but it is still related. So, just because you don’t own the property that you are living in, it doesn’t mean that you are not responsible for paying off the mortgage.
And we haven’t even talked about the government and bankruptcy. There are many problems that the government can handle, so do your homework.